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Pound struggling against Dollar

GBPUSD is falling since expectations of further tapering from Fed rose and continued to decline after the tapering announcement of further tapering by $10 billion. On the 4 hour chart we can see that the pair was consolidating between the two contracting trend lines giving bearish signal. And finally the U.K. manufacturing data came out after which the pair broke the resistance trend line and continued to follow the downtrend. According to Markit the U.K. manufacturing PMI fell to 56 in January from the reading of 57.2 in December missing the economist’s expectation of 57. That means the sector in U.K. expanded at the slowest pace in 3 months in January. Although new orders rose on the back of stronger domestic and overseas demand. And this will help in further job creation and we could see some improvement in the labor market and unemployment dropping below 7%. The pair found support at 1.6320 which was almost 3 weeks low. 1.6400 will act as a resistance for the pair which was previously acting as a support. If the unemployment drops below 7% we could see some strengthening in GBPUSD.